1. Voice Over Internet Protocol (VoIP) Issues and Challenges William McCrum Phone:+1 613-990-4493 Fax:+1 613-957-8845 Email: mccrum.william@ic.gc.ca

2. March, 20042 Content Network Evolution and drivers VoIP Realizations VoIP Deployments in Canada Impacts and Challenges –Technical –Policy and Regulation

3. March, 20043 IP-based Network Drivers Affecting Network Changes Network Simplification Lower start-up and operating costs Regulations Leap frog competition Fast service introduction and customization Improved codec compression techniques Faster processing power Traffic control mechanism Lower LD voice service rate Multimedia services Data traffic exceeds voice traffic Corporate Networks End User Service Provider Technology The telecom network is undergoing extensive changes to meet new market and service demands.

4. March, 20044 Network Architecture Evolution Today – Single Service NetworksFuture – Multi-Service Networks

5. March, 20045 Enters VoIP…What is it? Many names, different meaning to different people: –Soft-switching –Next Generation Voice Network –IP Telephony –Voice over Internet –Voice over Internet Protocol –Voice over Packet –IP Communications Various implementations of VoIP systems and user expectations.

6. March, 20046 VoIP Network Architecture – 3 Key Functional Elements Circuit-Switched Network IP Network SS7 IP Phone PC Client Media Gateway Controller / Softswitch / Gatekeeper Instructs Media Gateways on how to set-up, handle, and terminate individual media flows Media Gateway Controller / Softswitch / Gatekeeper Instructs Media Gateways on how to set-up, handle, and terminate individual media flows Media Gateway (MG) Translates between TDM voice and packet data Establish media path Media Gateway (MG) Translates between TDM voice and packet data Establish media path Signalling Gateway Inter-works with the SS7 network for call control Signalling Gateway Inter-works with the SS7 network for call control IP Different signalling and control standards between network elements: -H.323, MGCP, IETF Megaco/ITU-T H.248, SIP, SIP-T … -Different VoIP realizations and physical architectures

7. March, 20047 VoIP Realizations PC Applications PSTN Bypass –Toll –Enterprise –Broadband VoIP –Cable VoIP Next Generation Network –Circuit-Switch Replacement –Service creation and customization Smart Edge, Dumb network (Intelligence in CPE) Smart Network, Dumb Edge (Centralized Intelligence) Smart Network, Smart Edge (Distributed Intelligence) Combining network and CPE (edge) intelligence allows service customization and new service revenue Varieties of VoIP deployments

8. March, 20048 PC Applications – PC to PC (Internet to Internet) User –Free calls between PCs –Low voice quality and reliability Technology –PC client software (e.g. Microsoft NetMeeting) for voice and multimedia communications between PCs with the same client software –VoIP processing performed in PCs Network –Network traffic carried in public Internet –No legacy PSTN Central Office Modem (DSL, cable) Internet

9. March, 20049 PSTN Bypass – PC to Phone VoIP Gateway Gate Keeper Modem (DSL, cable) User –Voice calls between PC and PSTN phone –A fee normally charged –Voice quality varies, depending on service provider networks Technology –PC client software –VoIP processing performed in PCs Network –Network traffic carried in public Internet or in managed IP network –Requires VoIP Gateway to interwork with PSTN Central Office Internet /IP

10. March, 200410 PSTN Toll Bypass – Phone to Phone User –Cheaper long distance voice calls via pre-paid calling cards –Service offered since 1995 due to high international LD tariff –May require to dial up to 24-digits for call establishment –Voice quality varies –VoIP technology invisible to users Network –Global coverage and interconnection among allied VoIP service providers VoIP Gateway Gate Keeper VoIP Gateway VoIP Service Provider Central Office IP

11. March, 200411 PSTN Bypass – Enterprise IP PBX VoIP PBX provides Media Gateway and router functions Supports voice and data services Voice and data traffic between enterprise sites is carried by the IP network. PSTN carries overflow voice traffic and off-net calls Well suited for road warriors –Access corporate network resources –Make VoIP long distance calls on any Internet access to corporate phones or public PSTN phones. PBX IP Phone Enterprise HQ IP PSTN IP Phone Enterprise Branch VoIP PBX

12. March, 200412 PSTN Bypass – Broadband VoIP Service Provider New breed of VoIP service provider exploiting over providers’ broadband access User Features: –Low local and LD residential rates –Free calls to Canada –Extensive call feature set –Choice of area codes independent of customer location Cons to users: –Reliability - best effort service Dependent on access provider network reliability Affected by power outage –Number Portability –911 Vonage VoIP Network PSTN Analog Telephone Adaptor DSL/Cable Modem Router VoIP Gtwy DSL/Cable Infrastructure Phone to Phone

13. March, 200413 Cable IP Telephony – Converged IP Architecture Cable Headend CMTS IP MTA Customer Premise Router CMS MGC Media Gateway Regional Headend or Data Center IP Services (Internet, e-mail, etc.) data voice HFC MTA: Multimedia Terminal Adapter CMS: Call Management Server HFC: Hybrid Fibre-Coax MGC: Media Gateway Controller Signalling Gateway Source: Lemur Networks PSTN Video Services Router Cable Operator implements a single IP infrastructure and offers innovative new services (voice, data, video) to compete with telcos.

14. March, 200414 Carrier PSTN Circuit Switch Replacement Business Motivation –New competitive carriers: leap frog incumbent carrier by deploying new packet technology –Incumbent carriers: evolve legacy circuit-switched networks to packet-based to reduce cost and compete with new carriers –Provides IP Centrex features and service customizations as competitive solution to IP PBX Provides Phone - Phone communication –Users can continue to use traditional voice phone set –IP phones are supported in IP Centrex Stringent service and reliability requirements: –Voice quality at least equal to wireless phones –Five 9’s reliability

15. March, 200415 Canadian Carriers and Cable VoIP Service Offering Some examples…. Telus (2003-04) –PSTN toll switch replacement as first step to VoIP migration, –IP Centrex (hosted IP services) offering targeting corporate customers A voice-over IP (VoIP) service combining local and long-distance voice with new IP-enabled features. Bell (2003-04) –Provides IP Centrex features –Focus on service creation, customization, and integration –PSTN switch replacement in future Rogers Cable (planned 2005) –Full VoIP phone services offering, including 911 –In direct competition with the telcos Shaw Cable –Filed for CLEC status

16. March, 200416 Broadband Service Provider Offering Vonage (2003-4) –Vonage offers virtual second lines with Toronto area codes to customers with US billing addresses Allows people in Toronto to call a Vonage customer’s Toronto number without incurring long distance charges –Vonage started offering Canadians the same service it offers Americans in April 2004 Partnering with a Canadian CLEC who provides Canadian phone numbers and interconnection with the PSTN Primus (2004) –Partnering with a Canadian CLEC to offer VoIP Talk- Broadband TM service (PC-to- Phone) –Similar service offerings as Vonage

17. March, 200417 Technical Challenges Interoperability is the primary hurdle –Interworking of VoIP islands –The default (and less efficient) inter-connection is legacy PSTN/TDM Voice quality depends on engineering of managed IP network VoIP network security mechanism and implementation Lawful interception Local powering or network powering in case of power outages 911 Exhaustion of phone numbers Technical challenges and their solutions closely linked to policies and regulations.

18. March, 200418 Policy and Regulation – Technical Issues Interconnection architecture and tariff between IXC and IP CLEC –Current definitions under the CRTC Telecom Decision are based on TDM switch technology. These definitions affect VoIP interconnection arrangements and the associated tariff. –On April 7, 2004, the CRTC initiated proceeding on VoIP Services and issued a preliminary view (CRTC 2004-2)

19. March, 200419 Policy and Regulation – Technical Issues Interconnection architecture and tariff between IXC and IP CLEC (cont’d) –No agreement reached in CRTC on interconnection due to different views on the definition of “end-office” and “access tandem” under the IP network architecture: Is Media Gateway an end-office? Is the Media Gateway Controller an Access Tandem? Is the Media Gateway Controller an end-office while the Media Gateways it controls are “remotes”? Need to develop new technology independent definitions for End-Office and Access Tandem to accommodate VoIP networks.

20. March, 200420 Policy and Regulation – Competitive Issues Overall impact on competition is still impossible to predict –Would greater competition through VoIP lead to deregulation, or require greater regulation? –Will a major overhaul of competitive framework be required? Should telephony services be regulated differently due to different technologies used? –TDM –VoIP as PSTN replacement –VoIP offered by ISPs –Cable Telephony Access charges for VoIP service providers Unbundling of access and network services: –Should competitive access be provided to choose VoIP service providers via Packer Cable or DSL access?

21. March, 200421 Policy and Regulations – Consumers/Social Issues Should VoIP have QoS or Grade of Service guarantee? E911 obligations Powering of CPE Universality of voice services expectations for VoIP? –Carriers –ISPs Lawful Intercept requirement: does it apply to all forms of VoIP architectures? Number Portability obligations Consumer education on limitations of VoIP –VoIP service providers should specify VoIP technology limitations, e.g. No 911, no power outage protection, reliability not guaranteed, no number portability, etc.

22. March, 200422 Thank You